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For celebrities, licensing virtual products is a new way to make a buck and stay hip with a young crowd. Snoop Dogg’s manager, Constance Schwartz, said she did not have a clue about virtual worlds when Virtual Greats approached her this year, so she and her team spent a week exploring Gaia Online.

After seeing that many teenagers were spending their time and allowances there, Ms. Schwartz explained the concept to Snoop Dogg. She said it was an easy sell, given that Snoop Dogg had been one of the first rap musicians to license works for ring tones and voice tones. His only requirement was that all of the goods be “true to himself,” down to the hair braids, house slippers and plates of Roscoe’s chicken and waffles he regularly eats in Los Angeles.

Virtual Greats styles itself as “the first company to create a platform to bring high-value, copyrighted material into virtual worlds and social networks.” When I first heard about them in July, I wasn’t too excited about the Elvis license they were pushing, since it didn’t sound like a great match with the demographic. But based on the above quote, it sounds like their portfolio has developed a lot since then. According to the story, they now also have Justin Timberlake’s signature fedora on Gaia for $3.

Virtual Greats is an offshoot of Millions of Us LLC, a virtual world marketing firm that got its start creating Second Life builds for major brands. It’s great example of moving from using online environments as a media to enhance brand value to using online environments as a channel to monetise that brand value.

Some figures on item sales from the story:

So far, the deepening recession has not slowed sales of virtual goods, which executives attribute to people spending more time at home. Gaia Online, a youth world with seven million monthly visitors, sells more than $1 million a month of virtual goods and expects a record month in December, said its chief executive, Craig Sherman. One rival, IMVU, has also had a 15 to 20 percent increase in sales since September.

[…]a Gaia golden halo now out of production sold for $6,000 on eBay, he said.

Similarly, Virtual Greats has learned that it underpriced some items, like the Hulk Impact Crater, which originally sold for 50 cents, then went up sixfold in the Gaia aftermarket. In its several months of testing, Virtual Greats has found that people prefer more expensive items with a brand name over cheaper, generic items.